* Unit of Russia’s Acron sells Saskatchewan potash assets
* Buyer is Canadian arm of China’s Yanzhou Coal Mining
* Yancoal to buy potash properties for C$110 mln
* Proceeds to be used to develop other potash assets
TORONTO, Sept 30 (Reuters) - Mineral exploration company North Atlantic Potash said on Friday it has completed the sale of eight of its Canadian potash properties for C$110 million ($106 million) to Yancoal, the Canadian arm of China’s Yanzhou Coal Mining (600188.SS).
North Atlantic Potash, a subsidiary of Russian fertilizer maker Acron (AKRN.MM)(AKRNq.L), said the sale of the properties in the Western Canadian province of Saskatchewan will allow it to focus on key areas of interest within its remaining potash properties in the province.
Saskatchewan is home to some of the world’s largest known potash reserves. The mineral, mined in only a handful of countries, is widely used across the globe as a crop nutrient.
Some of the world’s largest fertilizer companies, including Potash Corp (POT.TO), Mosaic Co (MOS.N) and Agrium Inc (AGU.TO) all own potash mines in the province. The world’s largest miner, BHP Billiton (BHP.AX) (BLT.L), is developing its own potash projects in the province, after having failed in its attempt to acquire Potash Corp for $39 billion last year.
North Atlantic Potash said the cash infusion it is getting from the deal will allow it to move forward with advanced exploration and drilling programs on its core properties.
The deal comes just days after North Atlantic Potash signed a joint venture agreement with Anglo-Australian miner Rio Tinto (RIO.AX) (RIO.L). The two companies intend to focus on potash exploration and possible mine construction opportunities at some of North Atlantic Potash’s potash holdings in the southern Saskatchewan.
“After a successful closure of an important JV with Rio Tinto, this deal positions North Atlantic as a central player in the emerging potash development arena,” Arie Zuckerman, president of North Atlantic Potash, said in a statement.
Diversified miner Rio Tinto, which was forced to sell its potash assets to pay off debt during the global economic downturn in 2009, has been scouting for potash projects over the last two years as its financial position has improved along with a resurgence in commodity prices.
$1=$1.04 Canadian Reporting by Euan Rocha; editing by Peter Galloway